Stanchart profit soars 37pc

By , NAIROBI, Kenya, Aug 5 – Standard Chartered Bank (SCB) has reported a 37.5 percent increase in after tax profit for the first half of this year.

The bank recorded a Sh2.3 billion profit up from the Sh1.69 billion recorded over the same period last year.

Chief Executive Officer Richard Etemesi said the rise in profit was driven mostly by an increase in their loans and advances portfolio by 11percent to Sh50.3 billion due to growth in both consumer and corporate assets.

On the other hand, customer deposits grew by 29 percent to Sh95.1 billion. The net bad debt charge increased from Sh148 million in 2008 to Sh170 million in 2009.

Mr Etemesi attributes the growth to the bank’s strategy to building a long-term, sustainable business.

“We have a very clear strategy that is working well and has huge potential,” he said. “Our investment in new technology has enabled us to serve new customer segments and widen our customer reach.”

Mr Etemesi said that last year, in anticipation that technology would be the main driver for business growth in the sector, the bank focused on investing in new technology as well as teaming up with mobile phone operators to offer mobile banking services to its customers.

“The strategy is now paying dividends putting the bank in rather good shape – we are highly liquid, well funded and well capitalized and efficient,” he said.

Mr Etemesi noted that the bank’s cost income ratio had decreased to 41.2 percent compared to 48.4 percent in 2008.

“In the last six months, our total non-performing loans fell to Sh1.7 billion and remain among the lowest in the market. This translates to 3.6 percent of gross total loans compared to 4.4 percent in 2008, a reflection of our prudent approach to lending and proactive risk management capability,” Mr Etemesi said.